The Fox Business channel is counting down to the Largest Tax Hike ever:
They must have gotten the idea from the website for the Ways and Means Committee Republicans, which predicts that that Democrats will let the Bush tax cuts expire, lowering a $3.8 trillion boom into the gut of the weak American economy.
The first graph is mistaken. The second graph is a lie. As TaxVox's Howard Gleckman writes, everybody involved in the making of these silly clocks should be ashamed.
No Democrat of any significance in the federal government -- not in the White House, not in the Senate leadership, and not in the House -- is talking about letting the entire Bush tax cut expire. The debate is purely between the White House and like-minded Democrats who want to let the cuts expire for the top 2 percent, a 10-year tax increase of some $650 billion, and moderate Democrats and Republicans who don't want to raise taxes, period. Relative to current law, by definition, even the second plan would cut taxes by $2.4 trillion.
Gleckman goes on to the skewer the "largest tax hike ever" lie by noting that, as a percentage of GDP, letting the entire Bush tax cut expire wouldn't even be the largest hike in our seniors' lifetime.
The Revenue Act of 1941 raised taxes by an average annual rate of 2.2 percent of GDP, more than the impact of letting all the Bush tax cuts expire. The Revenue Act of 1942 was even bigger. It raised taxes by a whopping 5 percent of GDP. And, in case you were wondering, the three major tax increase bills signed by President Reagan-- TEFRA of 1982, the Social Security Amendments of 1983, and the Deficit Reduction Act of 1984--raised taxes by a combined 1.6 percent of GDP, not much less than what we are yelling about today.
The face behind the Ways and Means Republicans countdown clock is Rep. Dave Camp, the committee's senior Republican member who is also on the president's bipartisan deficit commission. His appointed role is to work with Democrats on taxes and entitlement issues to produce a medium- and long-term plan to reduce our deficit. And here he is, on his committee homepage, falsely accusing Democrats of doing something that over time would actually reduce the deficit! There's a rich debate to have about how to balance taxes and spending in the next decade, but this kind of duplicity is so multi-dimensional, it's almost impressive.